11 Burst results for "Justin Wolfers"
Bloomberg Radio New York
"justin wolfers" Discussed on Bloomberg Radio New York
"Now 5 .05 six six tk percent still elevated this morning but nowhere near where it was about an hour ago yields up there at the front end by I'll three bases times of the yields of my youth I mean I know we're going back to 2008 2007 blah blah we haven't seen this structure and my number one question throughout the morning how does America adapted this I mean if your Apple and like clockwork you come out with the next billion -dollar refi to buy back shares is mastering cook are they sitting there right now going maybe not to start the good news for them is that they did the adapting of the pandemic when interest rates were so low they push that maturity wall out and you'll get a lot of people fixed income that will tell you now that's in 2025 they've done a lot of work Tom to make sure those balance sheets are super super resilient then on the mortgage side we know what's happened on the mortgage side you've got people out there Tom on 30 -year mortgages with two handles on them who aren't selling okay but she's not coming back into the market so what is the pass -through we talked about this a lot we where know rates are at five and a half percent question you've got to ask is who's paying them at least are we pop at eight percent is that what we need to reframe as we stagger back to New York I think the mortgage market clearly is broken I think that that's what we've learned in terms of the number of people actually taking up mortgages there the big takeaway that I've heard is who is going to suffer with these higher rates maybe some smaller businesses from Patrick Harker on the peripheries you're sharing it more and more strongly I miss the Harker maybe Michael McKee did that but I strongly take that point of the uniqueness of small business we began hours ago in dark the the cold and snow -filled morning of Jackson Hole with a gentleman from the Peterson Institute Adam Posen we finish strong with another gentleman a senior fellow at the Peterson Institute Justin Wolfers joins us now professor of public policy and economics at Michigan and this finally at Jackson Hole where we will have an r -star discussion because you studied with Blanchard and Alberto Allesina years and years ago Blanchard has led the charge on trying to figure out where we're heading on r -star take that we're going to return to the low r -star out to the bloom of a unanchored higher r -star where do you see us not in one year six months in five years I think it's the right question Tom because if you want to think about what really pins down long -term rates it's not what the feds doing day -to -day it's doing deviations around r -star so then the big question is what is r -star well you could try and look it up on terminal but it's not there this is the difficulty though with macroeconomics that so many of the variables that we think matter aren't observable with r -star we got a million theories about it but what we do know or think we know is over four decades it's declined so best guess for the next decade seems like a pretty pretty good pattern so Larry Summers has come out and he sort of thinks r -star might be higher now that's part of his campaign to get rates that will be higher where's Justin Wolfers on this mate I reckon if you don't have a good idea about where something's going in a really solid story or you say things are just going to keep on being the same and none of the stories I'm hearing seem particularly convincing other than you you know I'm a macro economist with a view and I get paid to look confident I don't want to overstate anyone else's confidence I've got to dig into that you mentioned Larry Summers yeah you think it's a campaign there to interest get rates higher at this Federal Reserve? Oh not in the cynical sense Larry is a profoundly interesting economist and Larry's a friend of mine too what I'd say instead is Larry has a restless mind Larry spent five years trying to convince us all that our star was lower I didn't understand what he was talking about with secular stagnation for the first couple of years I finally understood it and at that point he changes his mind so the argument and the evidence I think for his original secular stagnation looks thesis really pretty strong then what's the story that says Larry was right five years ago and today's Larry thinks five years ago Larry is wrong I think he got it right a few years ago so you think just in terms of what we're going back to pre pandemic low inflation low growth do you think that sticks so I'm glad that you put it in the context of pandemic the because we all like talking about the post -pandemic economy we all like talking and feeling like we're in a post pandemic world but if you start to think hard about like the interactions within the economy the the pandemic exert continues to a really important influence on the economy and I think in ways that a lot of lay people and a lot of people on wall street don't think about and I think there's an emotional part to that I'm going to leave it behind I want to stop thinking about it and so I leave it out of my models but the moment you think about labor supply think about the return of women to the workforce work from home a fundamental transformation in the way we work all
Bloomberg Radio New York
"justin wolfers" Discussed on Bloomberg Radio New York
"Potential for a strike, Tom, is a wrinkle in the story, that's for sure. That's for sure. Lisa, we'll go back to a session we've had a few times. We've had the pay rises, we've had the union action, we haven't had the strikes. Exactly. And I don't think anyone wants to see those strikes anytime soon either. Which has transmitted into this belief that Labour has the upper hand and that if Labour has the upper hand, price increases can continue not just at union jobs but more broadly. And that is the key key question here, is that going to continue so that you see a longer and higher inflation and a stronger and better economy for even with the rates that we see right now. So it's time for the surveillance extrapolation. We do this every year at Jackson Hole. John, I'm trying to envision you, bronze shorts, working your butt off at P .S. popping 170 all in. That's so never going to happen. Why not? Why are you talking down the potential for this to happen? If we put John, Lisa if we put John at Flint, Michigan, building Buicks, what are you going to pop? 225? No, sure. You got to pay an auto worker more delivering boxes. I want to see this guy wearing those brown shorts and then we can have that discussion. I'm not a shorts kind of I think you know where I stand on shorts. Shorts are for the beach. Shorts are for the pool. This is serious stuff, this waves thing. Maybe it's a question for Lagarde. Are we going to come back to a more unionized European A labor system, I don't believe it, but it's where we are. And I know we've discussed this a few times, but while we're here and the conversation has come up, if we have the same level of union membership we did back in the 1970s, can you imagine the pass through into wages that we would have experienced? Huge, huge, huge, huge, huge. Thirty seconds before we get to our wonderful guest, my word for Jackson Hole, Complexity. I did not think I would say that two days ago. That's the zeitgeist this morning. The speech I'm interested in, Chairman Powell without a doubt is the biggest speech of global markets. There's no dispute about that. But the speech I'm interested in is the one from the Guard a little bit later. I agree. It's such a tough spot for the Europeans at the you have the data's coming in, inflation still elevated and over there at the ECB you've got a single mandate central bank with a lot of pressure coming from various parts of Europe. What's been interesting for me is listening to some of the more central bankers not sound hawkish at all over in Europe. When you listen to people from the Bundesbank, yes, they're committed to getting 2%. We know that. But are we hearing things like we need to go another 25, another 50? That conversation's changed. We're going to change the conversation right now as we shift from a discussion of Jerome Powell and the US Fed to Bloomberg's coverage of Christine Lagarde -John's speech here coming up in an or hour so. I lose the time zones, but the Brahma's got it all written down. We got the guard QA, and then we'll have our Bloomberg discussion with Christine wondering things when are going to break. And the question you need to stay with us. Coming up, Justin Wolfers will be with us from Michigan and joining us from basically Texas with macro policy perspectives. Juliette Coronado, who thinks we're going to talk Fed, but Dr. Coronado, we're going to shift this right forward to ECB. How much worse is it for a guard that makes her speech more important than what we heard from Chairman Powell? Jefferspot, as you just outlined, I mean, with the US, we have the beautiful combination of lower than expected inflation and better than expected economic growth. And Powell can just say, we're going to be patient and watch the data and do what we need to do. The guard has a tougher line to walk. You know, the data are weakening in a pretty alarming way and inflation is yet still elevated. So how do you factor in lags and the nuances and the risks? I'm going to interrupt right now because, John, it is a moment here X and whole, which is of importance when the lead central bankers come out to gaze at the Bloomberg to anyone set look at the mountains, John, why don't you identify the victims? Well, let's go through this piece by piece, Tom. Chairman Powell, Governor Wader, and President Lagarde, the United States, Japan and Europe, and Tom, I think we can say three central bankers facing very issues. different Judah Coronado just went through the United States. At the moment, Chairman Powell arguably in better position the of the three. Robust growth, inflation, they're making progress, there's still work to do. Governor Wader, at the moment, Tom, inflation, arguably, arguably what they've been looking for, for the last several decades and viewed as a once in a generation opportunity to reset inflation expectations higher in Japan. And then you've got President Lagarde somewhere in between, where inflation is above target and growth is a problem. Three central bankers, three different issues. The symbolism of this post pandemic is, I can state clearly, I have never seen this. We go back to Volcker in the 80s. I can't talk about those years, but for our American audience, this is a different central banker at the Bank of Japan. Mr. Bader, very much American educated, wonderful command of English. He joins the central bankers, including Governor Bailey, with a real grasp of the linkages of Japan, Lisa, to the Western banks. What this highlights to me is how everyone's grappling with the same mystery from very different vantage points and how interconnected the systems are. The idea of yields in the US and the long end rising. Some people say that Governor Ueda has more responsibility to do with that than Chair Powell. There is a question around how much they talk about this interconnectedness as they craft their policies. There's nothing synchronized about this global economy right now, Tom. There's nothing synchronized about it. If we'd had this meeting between these three individuals a year or so we'd maybe say that President Lagarde and Chairman Powell has a lot in common. They've got some work to do. Let's get inflation down. If coming we were out of the pandemic I think we'd all sit around a table and say we're on the same page, we're all working in the same direction. Are those three working in the same direction now? No, I have three different subsets and literally ECBUS I would say there isn't a direction here as well. Justin Wolfers there shaking the hand of the Chairman of the Federal Reserve. Mr.
Bloomberg Radio New York
"justin wolfers" Discussed on Bloomberg Radio New York
"A highly complicated moment for central banking and for fiscal and monetary policy making and we're seeing all of these different economists and policy makers try to calibrate and not err on the side. wrong You can feel like we're on a precipice of not knowing the other side and everyone's grappling with how to really weigh in best. People are off camera they're all waiting to meet you. I happen to stumble on one person who I wasn't he was a doctor and he's treating COVID and we talked about the new discussions of COVID and some of it's in the zeitgeist talked about the booster to come this fall but I am adamant that COVID the pandemic still all touches that we're doing. There's something that came clear after Patrick Harker speaking with us the Philadelphia Fed which president is the soft data the conversations that people are having are less positive than the conversations that people may be having here economically about what the numbers are saying and one key question is what kind of ammunition do governments have to support an economy that does go into a downturn given how much debt and given real deals it's a hard time to see how they're going to come down to such a significant degree. It's a five percent Atlanta GDP now fed. 5 .9 % I'm sorry I mean I didn't get the decimal. We don't do decimal points at Jackson Hall. Okay well six percent economy GDP that's not a slowdown. I mean it's just it's a reacceleration which is causing a lot of angst for a lot of people. Okay we're going to continue forward here. We've got a lot coming up. Justin Wolfers will join us here in a bit. I believe he has a shingle for Michigan. We had to do better than that. The Kellogg School of Management right now. Janice Eberle joins us, professor of finance at Kellogg and of course a former assistant secretary for economic policy at Treasury as well. Thank you so much. I flew in through O Herrick and you know you go over the north the firmament of Northwestern and to all of us of a certain vintage and you've had the great honor of all the academics at Northwestern of Robert Gordon and his ancient iconic work on the growth of this nation and his doubt in recent decades over our sustained growth. Take the Gordon Northwestern view into all the policy work you've done about a confidence in American economic growth. Well Bob of course is iconic and thank you for inviting me back here today. It's great be to with you. Bob Gordon is one of the stalwarts of Northwestern and the economics community more broadly and he had a long set of papers questioning what the future of productivity growth would be like that we'd had this boom and we've seen a little bit of it in papers already this morning and what comes next. Though I will point out that a year ago Bob had some work that some showed optimism uncharacteristically about productivity growth that was coming out of COVID. What you're famous for is how do we solve fractured policy. We can all agree that we have fractured policy in America right now. How do we coalesce our policy to get to a better growth, a better productivity? Well, in the debate that we saw reflected a bit in the Chair's remarks this This morning, as Lisa was saying, it's a very complicated moment and as the Fed is looking forward to what happens next. You see a clear focus on the target but also a little more of risk balancing and we saw last year in particular. And a more nuanced message that reflects that at a 5 % interest rate or higher, raising interest rates further is different than raising interest rates when they first got started. And that balance of risk, I think, reflects some of the complications that you were talking about. There's also an issue and a complication here of what the potential casualty about going into a downturn given the lack of potential fiscal stimulus that could really get into a system given the debt load and given how high financing costs are. How much does that create a more difficult scenario next time this nation, among many So that's the short run. It creates a more difficult calculus for the Fed immediately because increase the in interest rates has more of an impact when the economy is weakening, when balance sheets are wavering more than they have in the past. So part of the reason we've had this surprising strength now is that we came into COVID with a pretty strong economy and so it had less of an impact. But going forward we can't count on that and so the Fed's complicated Decision -making reflects hard decision -making for families, for businesses, and choices the that are being made throughout the economy. You know we were just talking about the mortgage market now everybody locked in their 30 or everyone who was smart and got ahead of this. The US government did not do that. They did not lock in the longer term low yielding debt. Is that a big problem? Why didn't they? Why didn't the US sell more debt that was 30 years and had a 2 % coupon? It's a combination of the Treasury and the Fed. The Treasury always has discussions about the maturity structure of the debt. And during a crisis they're especially focused on providing liquidity. And that means going in and providing shorter run securities rather than longer run securities. So US government debt tends to have a shorter maturity structure partially because of its special role in the global economy. But there's clearly an awareness that there's a cost to that of not locking in the longer Well run the key things we know is Northwestern is closer to Wrigley Field than Chicago. I want to dovetail what Kroszner is doing down at Chicago with what you're doing up at Northwestern. You and Randy Kroszner are hard wired to pay attention to American business. How does American in react business not only to the yield but just the Newtonian calculus moonshot in T -bill, a moonshot in two -year yield. Some would dare say a moonshot in the real yield. You're seeing that already a market response to rising issuance and and that's really gotten people's attention because we in that kind of response and certainly in the data that we've seen in in our professional lives and so that that gives pause and especially for businesses because their costs of capital are a premium on what looks to be or is close to a risk for security.
Bloomberg Radio New York
"justin wolfers" Discussed on Bloomberg Radio New York
"80% of what happened after May 2020 was a mistake. We had a real crisis in mate in May 2020. And thank God they stepped in and did something really radical. And the second and third waves of PPP being indiscriminate was a mistake sending checks to everybody was a mistake. Taking interest rates to where they were and then keeping them for that long. It was all a mistake. Except of course, if you receive those checks and if you're received those checks, they found pretty good. That was Michael shau their market field asset management CEO fabulous. He was brilliant yesterday, that full interview on Bloomberg dot com and on the Bloomberg terminal. If you want to take a look, let's take a look at Marcus right now on the S&P. Good morning to you. Up 8 tenths of 1%. It's a better market so far. Heavily dependent, of course, on what we may or may not get in 43 minutes time. The CPI report just around the corner. You also up four basis points on a ten year. That looks like a normal day, doesn't it? At four basis points on a ten year, I'll show you an abnormal day. Just look at the two year over the last three, four sessions. It's up 24 basis points this morning. Two years, four 21. Tom, last Wednesday, north of 5. Yesterday at the close, south of four. Yeah, I don't know, Brent crude can't get above 80 this morning, which really has my attention It's tangential. I get its tertiary, if you will. But I also we've got to look at these stocks, John. We've had a nice lift in the troubled agony of yesterday in a Friday. It's a name we keep going back to. That stock is up in a pretty market by 44%. Still down by 1.3%, but certainly recovering the lowest to 12 right now. Let's call it two 23 and be kind. We'll have to see. Right now because of time and a dash into the inflation report in 45 minutes, we're going to pretend there's not a financial crisis. I'm going to ask one selected question here on the history of economics and John and Lisa will dive into this CPI report. He is Vincent Reinhardt. He is chief economist at Dreyfus and Mellon, far more he led research at the Federal Reserve system under Alan Greenspan and was considered definitive and hurting PhD cats there over wonderful, wonderful research. Vincent, I would love to talk to chairman Greenspan about this this morning and I'm going to use you as a respected proxy. Were we unmeasured? Did we get out in front of our skis as the cliche is? I look at the first derivative of this rate rise and I'd never seen a steepness and abruptness on a log axis, like we've seen this time around. In hindsight, would you suggest we lost our green spanning way, and we were unmeasured. So Alan Greenspan always talked about letting the air out of the balloon slowly. I would go back to the transcripts in 1994 when FOMC participants were just banging on the table about how inflation had gotten out of control. It was important to contain inflation expectations. Sound familiar in any way. And Greenspan just kept saying 25 basis points. Back then, by the way, he was disrespectfully referred to as quarter. And it was with some reluctance that he picked up the pace of tightening. And then he read, they lost control of the narrative. There was that one. Did your own power lose control of this narrative? I think that he's done a pretty good job explaining why they're doing it. And look, he had a 1970s, early 1980s problem. This was serious and he expressed it with considerable vigor. I think that there's some questions about when they stepped up from 50 to 75. I still have the scars of June 13th. When they basically made a pivot in the blackout period, I think there's a question of stepping down from 50 to 25. But let's face it, if you raise the federal funds rate at one percentage point in under a year, you are going to break some crockery. And in some sense, the surprising thing this is not the first time you heard it. How come there isn't more restraint on agriculture is a British face in case. I did it for John. Thank you. I appreciate that. Actually, I did a meeting where I said you're going to break some China. And the client response was, but China's been doing fine. That's hilarious. We have broken some things. We've got some bank failures. And of course, I won't ask you to do comments specifically on the nature of the bank failures or on the names themselves. Can you tell me how you think? Given what we've learned through history. At this Federal Reserve will confront a bank failure when it sets monetary policy next week. Because you mentioned they've got a 70s, 80s inflation problem. Do they still have a 70s, 80s inflation problem? First working backwards, they made some progress. We were talking about something that is much more contained and progress has its own risk in terms of the dialog within the committee. It's going to be less pressing a problem for some of the FOMC participants. Second thing, let's go back and who are the Nobel laureates right now. Diamond devic and Bernanke, diamond David set up what it takes to have a self fulfilling run on a financial institution. Boy, I could you could teach that class out of Justin wolfer said this. Fourth quarter call report. And then Bernanke said that if that cascading failures can cramp economic activity. That's about what the triumvirate of
Marketplace with Kai Ryssdal
"justin wolfers" Discussed on Marketplace with Kai Ryssdal
"We were talking over story ideas at our meeting this morning and Kristen Schwab pointed out something that Powell said in his testimony yesterday, but which went by kind of quick. He was talking pal was about how a lot of the indicators the fed has been watching. Employment, consumer spending, inflation obviously. After starting to look a little bit friendlier, have all reversed in the past 5 weeks or so and are now distinctly less friendly. And then, Chris and pointed out that Powell spent a very quick moment on how unusually warm weather in January might have messed with seasonally adjusted data, making the numbers look stronger than they actually are. Seasonally adjusted is a term that we throw around sometimes, but it's an important enough concept that Kristen wanted to take a second to explain exactly what it means. And I said in our meeting this morning, yes, great idea. And then I said, you got to explain it so my mom can follow it. And she said, really? And I said, yeah. He misses riz doll. I know we've never met, so I'm going to let an expert convince you to listen to me, unravel the wonkiness of seasonal adjustments. Here's economist Justin wolfers at the University of Michigan. There are people who do this for a living. And it really, really, really matters. Because seasonal adjustments allow us to factor in wild swings. Say we own an ice cream shop that sells a lot during summer and a little during winter. We know not to freak out when it starts snowing and sales dip. And we're better able to see when something unusual happens, like a spike. We say, well, that must mean there's something good going on with ice cream sales. Turns out our new brownie ice cream is drawing customers. Now, the government does this too, because our economy is always fluctuating. Like if we didn't use seasonally adjusted numbers, it would look like we're heading into a recession every January. After the holidays, when retail sales tank. Jeffrey Myron is vice president of research at the Cato institute. But every once in a while, they don't quite happen to exactly the same degree. And that causes some confusion about what the data in a particular month or quarter actually mean. The confusion is figuring out the outliers, the browning ice creams. Sometimes they're obvious, like job numbers tanking because of COVID lockdowns or oil prices spiking because of the war in Ukraine. But January's outlier? Maybe the unusually warm weather coaxed everyone outside and fueled inflation? Jonathan Wright is an economist at Johns Hopkins. It's very hard to explain that all with weather. He says it's tough to trust data when the past three Januaries have been so weird. And though seasonal adjustments are based on several years of data, we're not in the same economy as 2019. So the risk is you can either overstate or understate the true strength of the economy. Got that misses riz doll?
Bloomberg Radio New York
"justin wolfers" Discussed on Bloomberg Radio New York
"Hearing to slim and to go to David bale and his decades of perspective of what to do on the market, but neither of them know what to do on Twitter. Lisa, there's no other story, 10 o'clock, 11 o'clock, east coast time last night. The dawning awareness, Twitter could be toast. Well, the fact that a lot of employees are leaving and some of them are even warning that potentially it might have trouble operating. It has not had trouble operating and all these people tweeted all of these last tweets and these last wishes to all of our listeners and followers and then of course they wake up and it's still working. So we'll see what happens, but it's going to be an issue for a broader swath of regulators, as well as of course. What are they going to do with the fact that Elon Musk just paid all that money for this firm? Well, that's a financial side. You mentioned that in the last hour, Justin wolfers the acclaimed Australian economist good morning Ann Arbor, Michigan, wolfers were finally going to see a Musk product in self-driving mode. It really puts. That's true. That really puts some true together. Yeah, absolutely. And chief twit. And he basically is saying, you know, we want to be hardcore. If you're going to be hardcore press here, nobody did. So that's where we're at. Justin is so cut and chiseled. He runs the marathon. He runs a New York City marathon and actually competes with a heavyweights up front as well. I mean, there we are on Twitter and bit dog. What do we do up $200 from yesterday's OMG? It's all gonna die. No, it isn't. There's a bigger question here about all of these pockets of stress that we see and there are some idiosyncratic Twitter. There are some more systemic potentially Bitcoin or maybe idiosyncratic given where FTX is. Why have we not seen the big kaboom from the withdrawal of liquidity from markets? And that's been one of the questions, especially given some of the hawkish speak, not only from the fed speakers, but also from ECB president Christine Lagarde earlier this morning. Well, the guard making important comments, folks. This has been floating here through the morning and for those of you that join us for our entire three hours, Mandy sing will join us here later in the hour. He is expert on what goes on behind the building behind that single headquarters of Twitter in California. Right now, we've got to look at the financial story with the data, futures up 25 down futures up one 53 vix quiescent 23.70, but Lisa, before your brief, we've got to look at further curve inversion just in the last 24 hours. What does that mean? This means that people are getting paid more to go short term than they are to go long term to lend long term. This raises a question of recession pretty much without a doubt and you're seeing this curving version across the board, including the fed yield curve, which has been a big issue. Why are we not seeing it reflected in certain pockets of optimism that still are out there? Let me walk to Susan amateur. So, oils off in the last 24 hours, Bren under 90, OMG, slow down, ten year yield, price up, yield down. Is that how you get to further inversion? Exactly. Well, actually, price down yield up, but not as much as yields are up on the front end. That's what it's been all week, right? So there's been this question of, again, the fed raising rates to restrictive levels. What we're looking at right now, though, is how much has already been priced in. And what is the consequence of that? That's been a big issue. Okay, give me a brief here. You lost me there in the last dynamics. There are two stunts spread, I'm sorry, it's confusing math any day of the week, and not in a Friday we just can't do that. And I confused you even more. So we're going to be speaking for social bankers who are going to be perhaps. Creating more clear, more clear discussion. Over in Europe, we've got Buddhist bank president joaquim nagel, ECB's class not at 8 15 and bank of airlines, Katherine Mann at 8 15. I'm very interested to hear from them. Catherine man out of MIT, real is she a hawk? I think so. She's like, let's go, let's go raise it. She's on the edge of bullard. Let's hear what she has to say and how she wants it into a downturn. Susan Collins at 8 30 from the Boston fed. At 10 a.m. we get U.S. existing home sales. How much do we see just the number of sales fall off a cliff? We saw homebuilder sentiment fall off a cliff to levels that we haven't seen going back more than a decade if you strip out the pandemic, ramifications, a fast moving story. And I'm right that this is a richer data series than one number. There's more data underneath it. There is, but here's the issue. Housing is the first ball to drop, right? That is typically the first industry to get affected most severely from rain hike. So how much do people glean some sort of insight in what's going to happen to the broader economy after that? And I'm on Sunday, the World Cup is beginning in Doha. And I'm very curious to see how that transpires and how that distracts everyone. So in fact, when we'll join us, she is there in Doha, she'll be with us here in a bit. Right now, David Balan, chief investment officer, global head of investments. It's city global wealth. David, I'm not surprised to hear you say quality is in order for 2023, but color the quality. What does it look like? Well, it's those stocks that are going to continue to earn money all the way through next year without a decline, those stocks that they dividends that pay buybacks, but you at least we're just talking about is incredibly important because the fed has raised rates and is going to raise rates more looking at the data on inflation that is behind it
Bloomberg Radio New York
"justin wolfers" Discussed on Bloomberg Radio New York
"Now Powell says it's got to go up. We don't know where it goes from there. So he's not telling anybody anything new here. They're likely to raise that rate to match. At least with the markets are saying, but that's the point they want people to focus on that. And that gives them maybe some flexibility to spread things out. They don't pause yet, he said that was clear. But they maybe come down so that they can get a little bit better read. The thing he said over and over again is that we've got a ways to go. And I think that's going to be the new watchword. I can make you and I know that every Central Bank and particularly major country central banks are haunted by how the Japanese got the rate call wrong a good 20 years ago, Justin wolfers wrote up on Twitter, the wonderful professor at Michigan about the asymmetry that was discussed today. Is this a J Powell who sang I'm not afraid to make the mistake the Japanese make? And if we overshoot and become too restrictive, we've got the confidence to turn around. Well, I think he's saying we're not going to make the mistake of ending too soon, which is more than just Japan. The ECB had that issue and of course United States Federal Reserve in the years before Paul Volcker under Arthur burns. So they've made that clear all along. They don't want to make that mistake. Now, the question is, as you and Michael gabin, we're talking about a few minutes ago when you get to a point where the unemployment rate starts to go up and you start to get the kind of political pressure that we've seen from democratic sub on Capitol Hill, do you feel maybe you need to back off a little bit and pulse try to thread the needle in saying
KSFO-AM
"justin wolfers" Discussed on KSFO-AM
"Here before we get into it. I was planning talk about because I just came across this in USA today and I don't know. It's what I needed to read. Today. Uh, About this couple. They've been married for 53 years old couple. But 53 years of marriage and 100 foster girls how they've dedicated their lives to foster Children. Oh, my God. One of those, you know stories. Is everybody feeling the same surge of? I'm not really a very good person. Well to the I'm trying. I'm trying not to focus on that. Because I'm incredibly self centered is the thing but I need I need more of that in my life. Oh, I see. That would make me happier, which is the weird You know? Thing about the whole thing if I did more of that stuff That would be a hell of a lot of work and giving up a lot of the things that I like to do and focus on. I would be happier. I know that for a freak. In fact, I don't think there's any arguing with. There's no arguing facts just interesting reading about this couple of 78 79. They've dedicated their lives to raising foster kids were still in touch with, and a lot of them went off to college and Have great lives and all that sort of stuff and just Yep, more. I need more of that in my life and let's focusing on. You know my disappointments. Did you say they were all girls? Yeah. What's interesting? They just decided it right. I'm not very good Reason Boy. Wonder if you just if you start with, you know, if you have a handful girls, it's just easier to have A non Internet introduced the boyfriend. I don't know I'd have to read the whole article and I might have a love that story. I need to do more of that sort of thing, right? Ah, reading the Twitter feed of this. Justin Wolfers, Susan, economist for Michigan, Reporting on the economic story of the last hour, just coming out today U. S payrolls grew by 266,000 this month. Which would be fabulous in normal times, but his utter disappointment at a moment when forecasters were expecting over a million jobs here. We're still missing millions of pre pending pandemic jobs. This is a big miss that changes how we think about the recovery, he says. Unemployment is stuck its 6.1% well above the pre penned emigrated 3.5%. That's despite the fact that millions are still not looking for work. While we've got Help wanted signs Coast to freaking Coast, and that's what the Wall Street Journal is focusing on is You know, trying to figure out exactly what's going on here you got you got millions and millions of people out of work. I mean zillions of people out of work and that a number of industries that are just suffering because they can't hire anybody. You know not to be grossly over simple about this. But the old saying remains true. If you want more of something, subsidize it. If you want less of it, tax it, we're subsidizing, not working. I mean, it's that simple. So The Wall Street Journal survey comes to the conclusion of How do you have so many people out of work and somebody help wanted signs, they said. It's three things. It's Fear of getting the co vered. I don't know if I believe that I do. I absolutely do. Yeah, just because in perusing liberal media that, like The New York Times story, I was just describing The stories about people who are vaccinate, fully vaccinated, afraid they have iced tea in the backyard with their also fully vaccinated friend. I have a skewed vision, I guess because I've been coming to work the entire time. From selling and crowded baseball fields and the rest of it. I just I have to take it on faith because I don't really hang out with people like that. My wife does occasionally. Huh? Anyway, So you got the according to the Wall Street Journal's survey of people wiring kid getting a job, um, fear of getting the cove ID. I can't go back to work because my school's not open. That's a chunk of people, which is, you know its own weird problem. And then finally, I'm making more. Not working. So you have Misunderstanding of science. The effects of terrible policy and the effects of terrible policy. It's not hard to understand. Oh, you know, let's go back to the governor of South Carolina, whose name is Henry McMaster. He directed the South Carolina Department of Employment and Workforce to terminate South Carolina's participation in all federal pandemic related unemployment benefit programs as of the end of June. Hey, says South Carolina's business is born the brunt of the financial impact of the covert 19 pandemic. Those businesses that have survived both large and small and including those in the hospitality tourism manufacturing in health care sectors now facing unprecedented labor shortage. The gum, Burr continued. This labor shortage is being created in large part by the supplemental unemployment payments that the federal government provides claimants on top of their state unemployment benefits. In many instances, these payments are greater than the workers previous paychecks. What was intended to be a short term financial assistance for the vulnerable and displaced during the height of the pandemic has turned into a dangerous federal entitlement incentivizing and paying workers to stay at home. Rather than encouraging them to return to the work force. I'd like to know what percentage of the people who aren't taking the these jobs. It's the whole I make more money stand at home. Ah, yeah, I wish we could nail that down, Um, to the extent that people would be honest, but I'm just one more thing in this press release. There are about 82,000 open jobs in South Carolina, which is not a terribly popular state. I don't know where it ranks. It's uh, I don't know, probably somewhere in the middle. But now somebody's job openings there for real jobs like and then and, uh, construction on a lot sort of stuff. I mean, you'd be making a you know, good wage you could live on, you know, have a family and all that sort of stuff. You know, I've mentioned a lot about the fact I've had Couple of fast food places, Hand me my food and a card saying we're not hiring an $18. Now are we get texts and comments on? Well, you know, people don't wanna work fast food or but somebody was before somebody was doing those jobs before the panda. All of human history. Think about that. My friends. There were people doing these jobs before the pandemic. Are they just now? All of a sudden, I thought this job anybody will do. Well, and I'm sorry, is a couple of guys who had some crappy dang jobs early in our lives. The idea that I don't want to do that. Therefore, I won't work at all. That's just it's no, no, you don't understand. That has never been a thing as the kids say. Not since they wrote that wack Each was 1400 year old song that we were playing. Not 800 years ago. Not 100 years ago that you didn't you didn't even starve. If we're gonna play a song. We need to play a song That's four days old, and it's this one..
The Indicator from Planet Money
U.S. Is About to Unveil the Ugliest GDP Report Ever Recorded
"Today on the show GDP GDP stands for gross domestic product and it's basically a sum total of all of the goods and services that the US economy produces. It's often considered to be the measure of economic growth. Yep. GDP includes all the cars, an air conditioners in shoes and haircuts Uber Rides, and fish tacos and pedicures that the country is producing and buying. And so atypical GDP growth number is like two percent a year or maybe a really great year three percent. It's like soccer scores they never it never gets very. Stay pretty low and that's because the US economy is enormous. So even when a lot of things change the GDP needle doesn't budge very much at least it didn't used to. That's right. The GDP numbers came out today and for the months of April May and June that's the second quarter. The US economy grew at an annualized rate of negative thirty two point nine percent that is today's indicator negative thirty, two, point nine percent and I have to see if I saw this number I was like our economy shrank by thirty three percents I mean that is a third of our entire economy, right? I mean that can only happen a few times. It was really scary. So I called up Justin Wolfer as he is a professor of economics and public policy at the University of Michigan. And I was like wait a minute is the US economy like one third smaller? Did we just lose a third of the economy and so did we lose their economy? In. Okay. Okay. It turns out the way that Americans report the GDP. is a little more confusing than you might realize. What actually happened is in the second quarter, we produced nine and a half percent less than we did in the first quarter. You might think we should report that as a decline in GDP of nine and a half percent. Yes. What we do instead is we say if we continued to plummet at that right for an entire year. At the end of the year, how much lower would GDP? That's what thirty two point nine percents. it says if the economy kept declining at a right of nine and a half sin quarter after quarter after quarter after quarter four quarters later, a level of output would be good. Two point nine percent lists now that's unrealistic. This was the worst quarter. Probably. In American history. So. Yeah. Let's say you do not try to extrapolate for the whole year. Then what you're looking at is that in April May and June the economy shrank by about nine and a half percent from the first three months of the year, which is way better than an economy that shrink at thirty, two point nine percent. But. That number still makes April May and June. The worst three months in the history of the US economy.
Weekend Edition Saturday
NFL Fashion Masks Available But Still Not Enough Protective Masks
"Sports merchandise site now sells face masks in the colors and logos of NFL teams let me just note that some masked look more appealing than others the dancing Miami dolphin could make you look like a bear with a fish in its mouth the website cautions that the team masks are quote a fashion face covering not intended to be personal protective equipment proceeds from all sales will be donated to the CDC foundation supporting the centers for disease control and prevention but you might wonder weeks and weeks into this pandemic how can health care workers still lack enough protective masks while mask for all thirty two NFL teams are being sold as fashion items Justin wolfers an economist at the Gerald R. Ford school of public policy at the university of Michigan told us the difference between the N. ninety five mask used in hospitals in the football team masks is akin to the difference between real jams and costume jewelry the end of the five respirator when fit closely is designed to block at least ninety five percent of microscopic airborne particles of the football team masks professor Walter says my understanding is that they're somewhat effective at preventing the wearer's germs from being sneezed out all over the place but they don't provide much protection to the wearer from germs that others may have spread their way in football terms the NFL mask might be good defense but offense of germs can still break through Justin wolfers explained at the master produced by different supply lines medical manufactures are stretched thin in this pandemic and find it hard to keep up with demand but the apparel industry shedding jobs and needs new work now so while fashion masks rollout quickly medical masks can be
Marketplace with Kai Ryssdal
We need to change our economic indicators to keep up with the crisis
"Know once you get past the scale of the job losses with the latest numbers on first time claims for unemployment. They came out this morning putting the total at just under twenty seven million people who've lost their jobs once you get past that scale it is the speed. That's amazing. Twenty seven million jobs vaporized in five weeks which poses a challenge for those of us who observe analyze this economy accustomed as we are to quarterly and monthly data. Being good enough. So economists are getting creative. Marketplace's refinish war gets is going. The great recession played out gradually over eighteen months. What's happening today's instead of playing out of a months and years playing out of days and weeks. Justin Wolfer is a professor of economics at University of Michigan our friends. Gdp and the unemployment rate are reported once a month once a quarter but we need is economic indicators. To tell us what's happening today. Andrew Chamberlain is chief economist at glass door. He says luckily we live in an age of data. We have really different ways of measuring the economy today than we have a decade ago tech platform social media specialized firms have all kinds of useful real time. Data take for example would job search platforms can tell us you've got Twenty million unemployed Americans. You Might WanNa know whether they are all expecting to go back to work or not You might want to know if they're out there searching for jobs or not. The Federal Reserve looks at data from credit card processors to know how people are spending and payroll processing from. Adp to track jobs. Both of those come out. Weekly Ben Hur's on is an economist with IHS market the TSA started making available The public passenger traffic At airports on a daily basis in real time. And so we could see that passenger traffic at us. Airports had fallen like ninety five percent by the end of March. Weekly chain store sales. Tell us about spending electricity. Use can be a proxy for economic output. As for what exactly it's all telling US Gary Schlossberg is global market strategist with the wells. Fargo Investment Institute. They still show the economy continuing to decline. But there are a couple which are beginning to bottom out a little bit you know. There's some hope straws in that the economy is still weakening but approaching about whatever the indicator once you hit bottom. There's nowhere to go but up